How to Write a Startup Business Plan
Anyone can come up with a brilliant concept. But turning an idea into a sustainable business is a completely different story. To remain organized and focused, you need to put your thoughts on paper before seeking legal advice, renting office space, or incorporating an L.L.C.
Many aspiring entrepreneurs launch their companies without a startup business plan. They either don't know how to write one or believe it takes a lot of work; the truth is, having a plan is critical. For leaders seeking external funding, writing a business plan can make all the difference. It involves understanding your target market, identifying their triggers, and devising marketing strategies to reach them.
In this blog post, I’m detailing how to create a startup business plan to help your company start off on the right foot.
What is a startup business plan?
A startup business plan is a written document that lays out your action plans for launching and operating your new venture. A well-crafted business plan is critical to the success of any startup; as you prepare your proposal, bare in mind that it will unfold as you learn more about your market.
A detailed business plan helps you set milestones for measuring success; a very important business aspect that investors look into for reassurance on the viability of their investment in your company. The best way to create a successful startup business plan is by including everything in an organized and clear document; below are a few tips.
Tips for writing a startup business plan:
Know your audience: Tailor your language and level of detail to match your audience.
Have a simple & clear goal: Simplify and break down larger goals into smaller, manageable tasks to get through them faster.
Focus on research: Spend enough time and effort on research from primary and secondary sources to develop an accurate business plan.
Create a startup toolkit: Research and identify the right startup tools and software to make the writing process easier.
Keep it precise: Keep your business plan short (within 20 pages) and easy-to-read (simplify the language).
Use a consistent tone: Keep the tone consistent throughout the entire startup business plan.
Add reference points: Reference authoritative data points for all information regarding the market, your competitors, and your customers to maintain credibility.
Be ready to pivot: Think of a business plan as an evolving document that will continue to change over time.
How to write a successful startup business plan:
Use this guide for entrepreneurs to develop or tweak your startup business plan:
Clarify the startup vision, mission, & values
Understanding your startup business is the first step to writing your business plan. Once you know what your startup does, ask yourself the following: What is the startup's mission? What problem will it help customers solve?
Write a company description
Start off by explaining who you are and what you do. Then, briefly describe why you're in business. Provide a summary of your goals, clarifying intangible aspects such as values or cultural philosophies.
Outline the executive summary
Keep it simple and to the point. Begin by drafting a one-sentence introduction that highlights the main customer pain point and how you propose to solve it. Identify who you are and when you plan to launch your business. Describe the products or services you’ll be offering and the industry in which you’ll be operating.
Identify your target market
Your business isn’t for everyone. This is undoubtedly the most important part of launching a startup company. If there’s no market for your business, the company will fail. That’s all there is to it.
“There is only one winning strategy. It is to carefully define the target market and direct a superior offering to that target market”
Develop startup goals & milestones
Without clear short-term goals, it can be hard to prioritize startup tasks. Ask yourself, do you want to focus on acquiring new customers? Or are you more focused on hitting a specific sales target?
Conduct market research & analysis
Ensure that there is a clear market niche; an ideal audience with a need that your business can help solve. In addition to researching your target market, you need to conduct a competitive analysis in parallel. Once you figure out who your competitors are, it will be easier to determine how to differentiate your company.
Identify the management & operational structure
Your business plan should also cover the organizational structure of your startup. If it’s a small company with just you and one or two business partners, this should be easy. Depending on how you’re planning to scale the company, it’s best to get this sorted out from the start.
Design the startup marketing & sales plan
Your startup marketing plan will help you define your company’s target audience and brand image. This section should outline how you plan to attract and retain clients. You'll also explain how the sale will take place. You'll refer to this section later when you make financial projections, so make sure to thoroughly describe your complete marketing and sales strategies.
Identify your budget & financial projections
The startup budget is an integral part of any startup that helps you take the guesswork out of writing expenses. Determine how much money you need to start the business and stay operational. Consider every little detail including equipment costs, property fees (buying or leasing), legal fees, payroll, insurance, inventory…
Conclusion
As thrilling as it is to start a business, it’s easy to get caught up in the moment and rush into things. Thoroughly writing out your plan gives you a much better understanding of your business. You may think you know what you’re talking about, but putting it on paper will truly make you an expert.
If you want to set yourself up for success, you need to take a step back and plan things out. Writing a formal plan increases your chances of success by 16%; it helps you secure an investment and improves your potential growth rate.
Though writing a business plan may seem mind-numbing right now, it will keep you organized and save you lots of troubles in the long run.
